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Case Study

Thuraya Satellite Telecommunications

By Allen J. Morrison and Rebecca Chung

21 pages

November 2006

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Reference: IMD-3-1622

Mobile satellite services, an industry which incurred huge initial investment costs and required a critical mass of users to break even, had emerged as a niche market with little evidence for large-scale growth. In 1997, Thuraya Satellite Telecomunications was established with a unique business model – instead of launching many satellites to provide global services, Thuraya, employing a more advanced technology, launched one high-quality satellite to provide regional services as a start to ensure early break-even. In addition, as opposed to competing against fixed-line and cellular services, the company chose to complement with these services. By September 2005, with a solid financial base and an impressive business performance, the company was considering its next growth options: 1) Focus on increasing utilization; 2) Expand services in Asia and establish an international image; and 3) Develop Multimedia. This case poses a question of how to further grow the company. Are they ready for a quantum leap? Which option(s) make sense? In which order and how should these options be implemented? And how to fund the growth?

Learning Objective

This case is designed to provide a thorough discussion of how companies can best drive growth. It explores growth via exploiting geographic competencies, growth by building on core competencies, and growth by product/market diversification. It also provides a vehicle for discussing the challenges of managing global expansion and rapidly changing technology in a non-traditional setting.

Keywords

Global Growth, Initial Public Offering

Settings

Middle East
1997-2005

Type

Field Research

Available Languages

English

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